Universal Credit criticised by spending watchdog

The Government's welfare reform programme - Universal Credit (UC) - has suffered from 'ambitious timescales' and 'weak management', according to a report by the National Audit Office (NAO).

The UC will merge a number of existing benefits into a single payment in order to reduce the costs and fraud associated with the current multi-benefit system.

The Department for Work and Pensions (DWP), responsible for the programme, was criticised by the NAO for:

overspending

taking risks in trying to meet short timescales

using a management approach inefficient for a project of this scale and complexity.

The DWP has been forced to delay the start of a national rollout of UC, originally planned for October 2013, due to IT glitches.

According to the report, more than 70 per cent of the £425 million spent on the programme to date has been on new IT systems. However, £34 million worth of these new systems has already been written off as it is unclear whether it will be able to support a national rollout.

Amyas Morse, head of the NAO, said: "Universal Credit could well go on to achieve considerable benefits if the Department learns from these early setbacks and puts realistic plans and strong discipline in place for its future roll-out."

Work and Pensions Secretary Iain Duncan Smith admitted there had been 'missteps' with the project.

"We can't underestimate the scale of the challenge," he said. "This is a fundamental transformation of the welfare system."

The DWP is to review its delivery, spending and IT plans. It will now extend pilot schemes to six more areas of the UK, with these sites taking on simple welfare claims.